Vehicles imports hit by 50% duty surcharge, new taxes for EVs

Sri Lanka has issued a gazette notice imposing a 50 percent surcharge on the import duty of vehicles, applicable for one year, as imports of personal vehicles were relaxed from Feb. 1.

“By virtue of the powers vested in me under Section 10 A of the Customs Ordinance (Chapter 235) as amended by Act, No. 83 of 1988, I, Anura Kumara Dissanayake, Minister of Finance, Planning and Economic Development of the Democratic Socialist Republic of Sri Lanka, do by this order levy on imported goods specified in the Schedule hereto, a surcharge at the rate of 50% on applicable Customs Import Duty, both General and Preferential basis, with effect from February 01, 2025 for one year,” the notice said.

A gazette was also issued detailing taxes for electric vehicles.

A new luxury tax gazette has also been issued, specifying 6 to 6 million rupees per car.

Sri Lanka banned the import of over 30,000 goods after the central bank printed money to target output, based on calculations made with IMF technical assistance.

Sri Lanka has restrictions on imports, including through taxes and exchange controls, because the central bank has a flawed operating framework which triggers forex shortages from anchor conflicts, and the currency depreciates due to a policy involving ‘interest rate as the last line of defense.’